28 July 2011
Section 44AD uses the words “Business”. The word “business” is different from “profession”. Section 2(13) defines “business” to include any trade, commerce or manufacture or any adventure in the nature of trade, commerce or manufacture. Whereas, section 2(36) defines “profession” to include vocation.
One may note that business does not include profession as held in G.K. Choksi 295 ITR 376 (SC). Therefore section 44AD does not apply to any profession. Following are some examples of profession: -
(a) CA/ CS/ CWA (b) Advocate/ Authorised Representative (including Tax Practitioners) (c) Engineer/ Architects (d) Doctor (e) Religious teaching [CIT vs Abdul Gani Gurdeji 213 ITR 798 (Raj.)] (f) Politics (g) Painter or any other artist
Following are some examples of business: -
(a) Trading of goods, (b) Trading of shares, stocks [CIT vs Lallubhai Nagardas & Sons 204 ITR 93 (Bom.)] (c) Manufacture/ process of any product (d) Tailoring (e) Beauty parlour (f) Restaurant and Hotel (g) Money lending (h) Banking (i) Commission or brokerage business (j) Real estate trading and development (k) Civil construction and ancillary activities (l) Infrastructure development (m) Nursing Home
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